Alzheimer's disease (AD), one of the most dreaded neurodegenerative disorders, is characterized by cortical and cerebrovascular amyloid β peptide (Aβ) deposits, neurofibrillary tangles, chronic inflammation, and neuronal loss. Increased bone fracture rates and reduced bone density are commonly observed in patients with AD, suggesting one or more common denominators between both disorders. However, very few studies are available that have addressed this issue. Here, we present evidence for a function of amyloid precursor protein (APP) and Aβ in regulating osteoclast (OC) differentiation in vitro and in vivo. Tg2576 mice, which express the Swedish mutation of APP (APPswe) under the control of a prion promoter, exhibit biphasic effects on OC activation, with an increase of OCs in younger mice (< 4 months old), but a decrease in older Tg2576 mice (> 4 months old). The increase of OCs in young Tg2576 mice appears to be mediated by Aβ oligomers and receptor for advanced glycation end products (RAGE) expression in bone marrow macrophages (BMMs). However, the decrease of OC formation and activity in older Tg2576 mice may be due to the increase of soluble rage (sRAGE) in aged Tg2576 mice, an inhibitor of RANKL-induced osteoclastogenesis. These results suggest an unexpected function of APPswe/Aβ, reveal a mechanism underlying altered bone remodeling in AD patients, and implicate APP/Aβ and RAGE as common denominators for both AD and osteoporosis.